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ChatGPT brought OpenAI $1.6 billion in revenue
Just a few months after launching a paid version of ChatGPT, OpenAI achieved annual revenue exceeding $1.6 billion, demonstrating the rapid adoption of generative AI by the general public. OpenAI is optimistically hoping to close the round with a valuation of at least $100 billion.
This meteoric rise represents a remarkable turnaround for a company that lost $540 million last year on revenue of just $28 million. Demand for the UI chatbot is outpacing even the company's optimistic predictions. Originally, sales of $200 million were expected by the end of 2023, but the number surpassed $1 billion by August 2022.
What's driving this AI gold rush?
For such revenue, OpenAI can thank the introduction of the ChatGPT Plus service in February 2023. The paid version, with early access and priority treatment of ChatGPT subscribers, allowed the company to earn money immediately. Regardless of the fact that the numbers we write about in the article are astronomical, analysts claim that this is just the beginning.
OpenAI management estimates that its annual recurring revenue could reach a staggering $5 billion by the end of 2024. This is almost a 400% increase in sales.
Get ready for new big stories
OpenAI CEO Sam Altman recently outlined development plans for a more advanced GPT-5 model coming to market. Although the timeline and capabilities of the model have not been discussed, you can bet that the GPT-5 will usher in the next wave of "must-have" artificial intelligence.
But OpenAI isn't the only company working on artificial intelligence – even if it sometimes feels like it. Competitors like Anthropic are rumored to be expecting similar hockey stick growth. Anthropic initially forecast sales of $500 million by the end of 2023, but now expects to hit $850 million at the expense of AI-hungry users.
Smart investors are betting billions that artificial intelligence will retain its power
OpenAI is looking to raise more than $100 billion in fresh funding to keep up with demand, with a valuation exceeding $100 billion. That's a significant jump from the roughly $29 billion estimate last April.
Going from $28 million to $1.6 billion in annual revenue in just over a year is simply astounding. As AI capabilities continue to gain traction in both enterprises and consumers, I expect OpenAI and its competitors to break growth records in the near future.
Are we ready?
